The "Cancún accord" approves a "green fund" for developing countries and gives recognition to the goal of reducing greenhouse gas emissions from industrial countries by 25-40% from 1990 levels within the next 10 years. Current pledges amount to about 16%.

10.50am:

The Bolivian delegation objected strongly to the deal which they say does not go far enough. But the deal was ruthlessly gavelled through by the chair of the meeting, Mexican foreign minister Patricia Espinosa. The move was greeted by cheering, applause and a standing ovation in the conference hall.

Espinosa is currently being showered with praise from the floor. Norway's lead negotiator said: "You have got more praise tonight than most human beings will get in a lifetime."

In reality, this is still a relatively weak deal, which does not produce the ambitious, legally binding cuts in emissions that many campaigners say are necessary. Many of the difficult decisions have been punted in the direction of the next gathering at Durban in South Africa. But considering the low expectations for these talks many are praising the agreement as a success.

10.57am:The Guardian's US environment correspondent Suzanne Goldenberg has sent this from the conference on one of the reasons why delegates have come away with a deal:

Suzanne Goldenberg

Negotiators and NGOs these last two weeks have responded very well to Mexico's handling of this meeting - for example, the constant reassurances from Patricia Espinosa that there would be no secret texts, that no countries would be left out. Was just talking to Becky Chacko, director of Climate Change policy for Conservation International, who said that attitude not only helped at Cancún but will help in months ahead as more countries feel invested in the agreement produced here and presumably will be more inclined to work to implement it

The approach has been very different. The Mexicans have tried very hard to maintain an atmosphere of transparency and inconclusiveness. In Copenhagen there was a hope that things could get pressed through so you had a situation where there was text being written behind closed doors and not everyone was included in all of the processes….Here they made sure that everyone was included and that led to a level of buy-in and consensus that we didn't have last year

Last year we had the Copenhagen Accord but it didn't work on paper. There wasn't that sense of buy-in that countries have now.

11.01am:

More from Suzanne Goldenberg:

Some interesting points from Bolivia's Pablo Solon. Unlike last year, Bolivia was entirely alone in the closing moments of the conference. He argues that the UN has gone against its own rules of consensus by moving ahead with the decision. He told me: "As you have seen this has violated the multilateral rules because they didn't respect the consensus. They are breaking the rules."

In addition, Solon argues that Bolivia's stance is closer to what the science says is needed on climate change. When asked about the cheering in the room for the agreement, he said: "They are thinking like politicians. The experts that know about climate change they know that we are right. This agreement won't stop temperature from rising by 4 degrees Celsius and we know that 4 degrees Celsius is unsustainable."

The European Union - as it said multiple times at this conference - saw itself as the bridge builder. It worked hard behind the scenes, with small island states, to find a solution to the dispute over the second commitment period for the Kyoto protocol. Japan and Russia formally announced at the conference that they would not sign on to further commitments under Kyoto when it expires at the end of 2012. Japan said repeatedly the agreement was unfair because it did not cover all emitters - a reference to both China, which as a developing country was not bound by Kyoto, and the US, which is not a party to the agreement.

Connie Hedegaard, European Commissioner for Climate Action, said: "The EU came to Cancún to get a substantial package of action-oriented decisions and keep the international climate change negotiations on track. We have helped to deliver the successful outcome the world expected and needed. But the two weeks in Cancún have shown once again how slow and difficult the process is. Everyone needs to be aware that we still have a long and challenging journey ahead of us to reach the goal of a legally binding global climate framework".

Joke Schauvliege, Flemish Minister for Environment, Nature and Culture, who represents the Belgian presidency of the Council of the European Union at Cancún, said: "The EU has worked tirelessly to be a bridge-builder in Cancún while also advancing its positions. The EU has reported transparently on the progress it has made in mobilising the €7.2bn of fast-start funding its has pledged over 2010-2012 and we will continue to do so on an annual basis. We congratulate the Mexican Presidency on conducting an exemplary conference."

11.14am:

So it turns out that the predictions of EU president Herman Van Rompuy of failure at the talks were overly pessimistic.

The Guardian reported leaked US diplomatic cables last week in which US diplomats reported, "Van Rompuy said he has 'given up on Mexico'," the American reported, while his chief of staff, Van Daele, likened the Cancún talks to the repeat of a bad film and said: 'Who wants to see that horror movie again?' "

11.19am:

Reaction is beginning to flood in now. Here is Oxfam International Executive Director Jeremy Hobbs:

An Oxfam shop in New Bond Street, central London. Photograph: Ray Tang/Rex Features

Negotiators have resuscitated the UN talks and put them on a road to recovery. This deal shows the UN negotiations can deliver. There is now hope for action to help the millions of poor people who are already struggling to survive the effects of climate change.

With lives on the line, we must now build on this progress. Long-term funding must be secured so the Climate Fund can start to deliver, helping vulnerable communities protect themselves for the climate impacts of today and tomorrow.

11.28am:More reaction, this time from Friends of the Earth's International Climate Campaigner Asad Rehman:

The world needed strong and determined action to tackle climate change in Cancun - the outcome is a weak and ineffective agreement but at least it gives us a small and fragile lifeline.

Russia, Japan and the US, backed by powerful vested interests, have pursued a selfish agenda which has opened the door to a hazardous system where emissions targets would be decided on the whim of politicians, rather than by science.

The emissions cuts on the table could still lead to a global temperature increase of up to five degrees which would be catastrophic for hundreds of millions of the world's poorest people."

Establishing a Global Climate Fund is a vital step forward in providing developing countries with the money they need to tackle climate change - but the pledges of funding are very far off what is needed.

11.29am:

The Guardian's US environment correspondent Suzanne Goldenberg with US climate envoy Todd Stern's reaction to the deal.

In the cold light of morning, many will agree that their diplomatic triumph offered little tangible progress to further reduce emissions of carbon dioxide into the atmosphere. During two weeks of talks nobody upped their promises to curb emissions.

The text remains a record of work in progress, full of language promising deals on hard issues at some future date. A year after the intended deadline for a new climate agreement in Copenhagen, a deal is still far off.

The relief at getting an agreement – any agreement – is nonetheless palpable here in Cancún. And undeniably, there has been some progress. The texts enshrine the pledges to cut emissions made by the 55 nations and the European Union in the aftermath of last year's failed Copenhagen talks. Crucially, that includes pledges from developing nations, who had no obligations under the Kyoto protocol.

However, the agreement acknowledges that the pledges are insufficient to meet the promise to cap global warming at 2 °C. Researchers from the Climate Action Tracker who were crunching numbers within the conference halls said the pledges set the world on track for 3.2 °C warming.

The texts "urge" nations to do more. Unless they do, it seems possible that no deal will be done at all. And the "triumph" of Cancun will look as disastrous as the breakdown of talks in Copenhagen a year before.

12.23pm:Another aside from reaction to the deal. A quick follow up on the Dessler cloud paper argument (see 10.47 in yesterday's live blog from the talks). Dr John Abraham at the University of St Thomas and Prof Scott Mandia at Suffolk County Community College have pointed out that Science has responded. H. Jesse Smith the editor who handled the paper is quoted as saying:

"There was never a word about Cancún," he says. The paper was submitted in May and received "a lot of review and re-review" before completing revisions on 21 October. It was officially accepted on 9 November, Smith says.

"Dessler never asked to get the paper expedited," says Smith. But once peer review was complete, Smith says, the editors pushed to have it published in time for the annual fall meeting of the American Geophysical Union (AGU) in San Francisco, California, which begins on Monday, 13 December. "I wanted to get it out before AGU."

EU commission for climate action Connie Hedegaard admits that she came to Cancun feeling that there was very little to be done, and she was very gloomy in her briefing 20 hours ago. At her press conference now though she says that there was a shift in atmosphere in the room after 7pm once the draft texts began circulation. Or as she put it: "we got feeling in room that there are really high stakes for those who want to block this."

12.51pm:

I'm signing off and leaving you in the capable hands of my colleague David Batty.

12.54pm: Hi, David Batty here - I'm taking over the live blog for the afternoon. You can read our latest news story on the Cancún deal here. The UN's press release can be read here.

British prime minister David Cameron has praised the agreement. He said:

The Cancun agreement is a very significant step forward in renewing the determination of the international community to tackle climate change through multilateral action.

Now the world must deliver on its promises. There is more hard work to be done ahead of the climate change conference in South Africa next year.

I am clear that Britain will meet its international obligations. And I will continue to make the case for a global, comprehensive and legally-binding climate agreement.

1.09pm: The UK Confederation of Business Industry (CBI) has welcomed the deal but claimed there is only so much businesses can do without a legally binding global agreement on cutting emissions. Neil Bentley, the CBI's director of business environment, said:

Such a deal could unlock great new low-carbon markets for our economy, and until this is reached, concerted action will be slow.

"We must use progress at Cancun as a starter's pistol for getting a legally binding deal next year that will cut emissions and help drive green growth.

1.18pm: More reaction from our US environment correspondent Suzanne Goldenberg:

I've heard a lot of comment this morning that the deal is a big win for the US, which came to Cancun with nothing to offer – given that Obama is not going to be able to deliver anything substantial on climate for at least the next two years.

As Todd Stern, the US climate envoy, indicated at his press conference, Cancun delivers on two important matters.

Firstly, it solidifies the idea that emerged at Copenhagen that emerging economies like India and China will eventually be legally required to cut their emissions – like the historic big emitters.

"What we did this year is bring a lot of substance into that agreement," Stern said. "Ideas that were first of just skeletal last year and that weren't approved are now approved and were elaborated on. That is the core of what we see as a significant step forward."

The deal at Cancun also puts China under an inspection regime – an important selling point for the Americans back home.

"Both a commitment to take action and an agreement to do so in a transparency manner can only be hopeful," Stern said.

It would be great to get a real inside look at the US-China discussions – always the big issue at UN climate negotiations. Last year's atmosphere was, by most accounts, horrendous. This time around, both sides negotiated hard – but were on good behavior.

China's president Hu Jintao is due to visit Washington in the new year and nobody wanted a blow up.

Stern noted that he had held several meetings with China since Copenhagen. He had also been video-skyping with Xie, his Chinese counter-part.

In the big picture though of dealing with climate change, he admitted the deal made incremental progress

"This is really complicated stuff," he said. "But if you can take good steps every year that is probably a better idea than hoping you can go for the world long jump record getting 30 yards at once."

For him, the turning point was a 12-hour meeting – with breaks – hosted by Mexico that finally broke through the stand-off over the future of the Kyoto protocol.

1.38pm: More reaction to the deal from environmentalists, who note that while it was a step in the right direction it falls short of the action required to curb global warning.

Wendel Trio of Greenpeace said: "Cancun may have saved the process but it did not yet save the climate." Alden Meyer, of the Washington-based Union of Concerned Scientists, agreed that it "wasn't enough to save the climate. But he added that the deal "did restore the credibility of the United Nations as a forum where progress can be made."

3.03pm: We're closing the liveblog now. But there'll be more coverage of the deal in tomorrow's Observer.

In the meantime, here's a recap of the main points of the agreement:

•All countries to cut emissions

•Payments for countries who avoid deforestation and conserve nature

•Finance deal to provide $30bn for developing countries to adapt to climate change now, and potentially up to $100bn later.